Net effective rental growth continued in the second quarter in markets with high occupancy, particularly the UK and Northern Europe.

The strongest markets in the second quarter for occupier demand were: Gothenburg, Munich, south Netherlands, Lyon, and Le Havre in Northern Europe; Prague, Poznan, Wroclaw, and Bratislava in Central & Eastern Europe; and the Midlands, London and south east England in the UK.

Supply of modern Class-A distribution facilities remains low across all European markets. In the second quarter, Prologis Europe initiated six developments, totalling 81,300 square metres, of which five are speculative and one build-to-suit, including:

In the second quarter, Prologis Europe acquired three facilities totalling 73,740 square metres in the Netherlands, the UK and France.

Prologis disposed of one industrial facility totalling 3,100 square metres in France and 40 acres of non-core land in the UK and France.

“Supported by increasing confidence, occupier markets continued their recovery, albeit at an uneven pace,” says Philip Dunne, president, Prologis Europe. “These improving operating fundamentals have led to an increase in development activity in select markets and we are seeing capitalisation rates compressing for the fifth consecutive quarter.”